2012-09-06 08:01:12 - Malaysia Metals Report Q1 2012 - a new market research report on companiesandmarkets.com

The Malaysian steel industry is developing apace and will continue to grow over the next five years, despite economic headwinds, according to BMIs latest Malaysia Metals Report. BMI estimates Malaysian crude steel output grew 14.8% year-on-year (y-o-y) in 2011 to 6.54mn tonnes, while hot-rolled output grew 16.1% to 5.74mn tonnes. This is a significant upward revision from the previous quarter. We believe domestic demand remained resilient in H211, offsetting the effects of a US downturn, as a tight labour market provided support for private consumption growth. The implementation of the governments Economic Transformation Plan continued to provide support for gross fixed capital formation growth. Hot-rolled output has been bolstered by the countrys 25% import duty on hot-rolled coil; the government

 

 

has refused a request by flat steel producer Megasteel for a rise to 35%. Imports remained subdued due to the high tariff barrier, growing just 0.2% to 5.05mn tonnes in 2011. We forecast a gradual rise to 5.97mn tonnes by 2016. Nonetheless, Malaysias economic growth should remain subdued in coming quarters. In light of a deteriorating outlook for external demand, we downgraded our real GDP growth forecasts to 3.2% for 2012. Steel consumption and output growth will slow accordingly.
The construction sector is vital to the recovery of the Malaysian steel market as it represents 71% of the countrys steel consumption. Construction activity was boosted by the sizeable influx of public infrastructure projects being implemented in the latter half of 2011. Accordingly, we are maintaining our 2011 full-year estimate for the Malaysian construction sector, with real growth projected to reach 5.6%yo- y. However, beyond 2011, we expect construction activity to decline due to a lack of financing from the private and public sectors, pulling down construction real growth to 4.8% in 2012 and falling in subsequent years. This will limit growth in the Malaysian long steel market.

The industry will be boosted by capacity growth over the forecast period with Hiap Teck Venture Bhds planned 700,000 tonne per annum (tpa) first phase coming onstream in mid-2013 with a further 800,000tpa in the second phase. Around 40% of output will be exported to Asian markets with the rest sold locally. This should help ensure output of 9.5mn tonnes in 2016, up 46% over 2011 levels.

Malaysia will increase the value of production with downstream operations. The commissioning of the first phase of Acerinoxs Bahru Stainless complex in December 2011, with capacity of 240,000tpa, has significantly enhanced the competitiveness of Malaysian stainless steel production. The construction of phase two is now proceeding with start-up scheduled for Q113, increasing capacity to 400,000tpa and allowing Bahru Stainless to produce special steel grades and thin gauges, adding more value to production. In its final stage, the project will become an integrated stainless steel factory with a melting capacity of 1mn tpa and a cold rolling capacity of 600,000tpa to be established by 2020. Around 70% of output will be destined for export. The price of this market report covers 4 quarterly reports on this sector. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.

Click for report details: www.companiesandmarkets.com/Market/Industrial/Market-Research/Ma ..

Browse all Industrial Market Research Reports www.companiesandmarkets.com/Market/Industrial/Market-Research?aC ..

Browse all Industrial Company Profile Reports www.companiesandmarkets.com/Market/Industrial/Company-Profile?aC ..

Browse all Latest Market Research Reports www.companiesandmarkets.com/Market/All/Market-Research?aCode=f3f ..

About Us
Companiesandmarkets.com is a leading online business information aggregator with over 300,000 market reports and company profiles available to our clients. Our extensive range of reports are sourced from the leading publishers of business information and provide clients with the widest range of information available. In terms of company profiles, Companiesandmarkets.com’s online database allows clients access to market and corporate information to over 100,000 different companies. We provide clients with a fully indexed database of information where clients can find specific market reports on their niche industry sectors of interest.